Michigan Compiled Laws, Chapter 566. Fraudulent Conveyances and Contracts § 566.131
Current as of February 09, 2022 | Updated by FindLaw Staff
Welcome to FindLaw's Cases & Codes, a free source of state and federal court opinions, state laws, and the United States Code. For more information about the legal concepts addressed by these cases and statutes, visit FindLaw's Learn About the Law.
Sec. 1. (1) Except as provided in subsections (2) to (4), a deed of gift, conveyance, transfer, or assignment, verbal or written, of property made in trust for the use of the person making the gift, conveyance, transfer, or assignment is void as against the creditors, existing or subsequent, of the person.
(2) Subsection (1) does not apply to the lapse, release, waiver, or disclaimer of a power of appointment given to a donee by a third party. As used in this subsection, “donee” means that term as defined in section 2 of the powers of appointment act of 1967, 1967 PA 224, MCL 556.112.
(3) Subsection (1) does not apply to the creation of a trust by an individual if all of the following apply:
(a) The individual created the trust for the benefit of the individual's spouse.
(b) The trust is treated as qualified terminable interest property under section 2523(f) of the internal revenue code, 26 USC 2523.
(c) The individual retains a beneficial interest in the trust income, trust principal, or both, which beneficial interest follows the termination of the individual's spouse's prior beneficial interest in the trust.
(4) Subsection (1) does not apply to a gift, conveyance, transfer, or assignment from a trust to a person who created the trust if all of the following apply:
(a) The trust is an irrevocable trust for the benefit of third parties.
(b) The trust is a grantor trust with regard to the person for income tax purposes under sections 671 to 679 of the internal revenue code, 26 USC 671 to 679.
(c) The trustee has the discretionary authority to reimburse or advance trust property to the person for taxes concerning income attributable to the trust property.
(d) The gift, conveyance, transfer, or assignment is the exercise by the trustee of the discretionary authority described in subdivision (c).
Cite this article: FindLaw.com - Michigan Compiled Laws, Chapter 566. Fraudulent Conveyances and Contracts § 566.131 - last updated February 09, 2022 | https://codes.findlaw.com/mi/chapter-566-fraudulent-conveyances-and-contracts/mi-comp-laws-566-131/
FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.
Was this helpful?